I cover private equity, asset management and financial regulation for City A.M. You can contact me on lucy.white@cityam.com with stories and commentary.

Investors think bitcoin trading is more crowded than the Nasdaq (Source: Getty)

Lucy White

The fact that bitcoin may have found favour with secretive North Korea is yet another sign that the cryptocurrency has exploded this year – so much so that it was today ranked the most crowded trade by investors.

A survey from Bank of America Merrill Lynch (Baml) found that 26 per cent of investors considered “long bitcoin”, where people are betting on the cryptocurrency appreciating in the future, to be the most crowded trade.

This overtook the 22 per cent who thought the same about the Nasdaq Composite index and the 21 per cent who believed that shorting the US dollar was the most crowded trade.

The survey also found that US stocks had fallen to 28 per cent underweight in investors' portfolios, and the last time it slipped lower than this was in November 2007 as the financial crisis bit.

Baml's survey has carried some relevance in the near past. For the first four months of this year, investors ranked long bets on the dollar's appreciation as the most crowded trade – since then, the greenback has slipped against sterling and the euro as well as other major trading currencies.

Bitcoin has been booming this summer, hitting new heights as it becomes more widely accepted, although it took a pummelling last week when China announced it would ban initial coin offerings (ICOs).